Some public sector fleets are employing Six Sigma to reduce operational costs and streamline and improve predictability of business processes.
Not simply a training program, Six Sigma is a business management strategy. Originally developed by Motorola, the strategy seeks to improve process quality by identifying and removing the causes of errors and variability, in other words, improving the overall efficiency of business or fleet. Since its inception, the strategy has been modified to apply to service industries as well.
Six Sigma projects carried out within an organization follow a defined sequence of steps and have quantified financial targets (cost reduction or profit increase). Each participant, called a "Belt" (Black, Yellow, or Green) is required to have a leadership-approved project prior to training.
Polk County Goes Lean
Bob Stanton, CPFP, fleet director, Polk County, Fla., modified the improvement steps to suit his business needs.
"Lean" focuses on maximizing process velocity through the elimination of waste. The process identifies eight types of waste or non-value added effort.
"Work orders are our most involved process so we started there," explained Stanton, who established a process improvement team to streamline processes using Six Sigma.
"There are several steps in the DMAIC (Define-Measure-Analyze-Improve-Control), particularly in the Define area, that we streamlined as we felt some steps weren't needed," explained Stanton. "We did define the process using a process map, but again, we chose to eliminate some of the steps in this process."
Using Lean's Kano Model, the County evaluated each step in the work order process, particularly concerning the security and location of vehicle keys to bring more control and structure to that specific area.
Stanton said the "5 Whys Analysis (Lean)" process was particularly helpful as fleet determined why each step in the process existed and determined its relative value.
"Some steps were cast aside and others were modified. As a result, we developed a before-and-after flow chart to illustrate to ourselves and our staff how the work order was changed," said Stanton. "In addition, we also implemented a Lean process called 5S. It is particularly helpful in maintaining shop organization and cleanliness."
5S means Sort, Straighten, Shine, Standardize, and Sustain, and is the Japanese concept for housekeeping.
Stanton also encourages his employees to practice Kaizen (practices focusing on continuous improvement in business activities). According to Stanton, every good fleet manager already does this if he or she practices management by walking around. This process, extended to all employees, builds ownership in continuous improvement.
Finally, all management staff is encouraged to propose opportunities for change using PDCA (Plan, Do, Check, Act).
The County eliminated six unnecessary steps to streamline its processes.
"Although our housekeeping was good, 5S has made us better," said Stanton. "It's a constant process, but employees have embraced it because they've seen how their own work environment has improved, and it's made locating commonly used tools and equipment easier and less troublesome."
Stanton strongly recommends 5S, even if Lean or Six Sigma isn't utilized. Lean provides a detailed road map for process improvement. As fleet managers study it, they will find they're already using some of the elements, noted Stanton. Lean provides a road map that can be utilized in any management situation.
Six Sigma's production-related principles apply to fleets since, although primarily a service function, fleet processes involve production, said Stanton.
"We produce work orders, we monitor shop throughput, we are a production environment," said Stanton. "The processes provide analytical skills useful in any management situation. I found them particularly helpful as teaching tools for front-line supervisors. These tools gave the supervisors practice using an analytical method to evaluate problems or issues well beyond those we were acting on directly."
Six Sigma Proves Helpful in Daily Fleet Operations
The Broward County, Fla., Sheriff's Office uses Six Sigma "in our daily operations, which stresses the use of metrics to measure performance. By measuring to establish a baseline, you can then verify the process improvements. It allowed us to measure and standardize our document controls, communication methods, and pay plans," explained Michael Best, general manager, First Vehicle Services. "As part of our 5S project, we renovated the interior of our repair facility early in the process to show everyone the culture change we wanted to facilitate, which helped us gain employee buy-in while also improving our professional appearance to the end user."
The Sheriff's office also performs monthly tool calibrations and testing to verify equipment performance, saving costs by minimizing incorrect diagnostics and poor repairs. A quality control plan is used to verify, quantify, and reduce repeat daily repairs.
"We see an advantage in having everyone on the same page and following the same set of instructions," said Best. "We trained all employees on the Six Sigma process, and in this way, we have all of our staff looking for ways to improve their processes. Additional learning along the way improves the process, and the result is continuous improvement."
The entire fleet organization experienced morale improvements resulting from the renovation, input, and implementation of staff ideas. Technician production averages around 120 percent (compared to industry norm), according to Best, up significantly from the industry norm of 80-85 percent.
"This attention to process controls along with improvements in productivity and efficiency allow us to maintain a 3,200-unit fleet with a minimal location and minimal staff," said Best.
Six Sigma offers a new approach to employee engagement as well as a standardized approach to evaluating work and cost savings.
Upfit Pre-Planning Provides Benefits
The Minnesota Department of Natural Resources (DNR) also utilizes Six Sigma in managing its fleet. Dave Schiller, CAFM, fleet safety & materials manager, has a Green Belt (see sidebar for belt definitions), while his boss holds a Black Belt.
The department uses Six Sigma to improve speed and ease in upfitting new equipment items for prompt use, and just as importantly, removing old units from service.
The department assembled a group to establish research objectives, including:
- Decrease median upfit time of DNR road vehicles.
- Develop "high-level" and "detail-level" process flowcharts.
- Establish specific work-flow project objectives, strategies, and inputs.
The department seeks to improve fleet quality and reliability, reduce overall costs (specifically by taking better advantage of warranties), trim repair costs (for existing equipment while waiting for upfit completion), remarket equipment more quickly, and reduce underutilized equipment.
"We are working to better serve customers," explained Schiller. "Among our challenges are that some of our upfits, such as a pool sedan, are minimal, while others, such as an enforcement truck or firefighting rig, are fairly extensive."
The department is working on better upfit pre-planning with the customer before equipment arrives to ensure agreement and acquire needed parts, etc.
"We're not done with this project yet, but we are beginning to see the benefits we expected," said Schiller.
Ft. Wayne Problem-Solves with Six Sigma
According to Larry Campbell, CPFP, fleet manager, each fleet staff member at the City of Fort Wayne, Ind., is a Six Sigma Belt, from Yellow to Green. Campbell himself has been working on his Black Belt.
The City of Fort Wayne utilizes Six Sigma to manage all work processes that can be controlled or defined, measured, and analyzed.
Through use of 5S methodology, the City focused on effective workplace organization, reduction in waste, and improved quality and safety.
The City began employing Six Sigma in 2000 under Mayor Graham Richard. Campbell worked on several black and Green Belt projects throughout the City.
"In the City fleet department, a few ways we used Six Sigma was as a measuring tool for take-home cars and doing away with the program to realize savings," said Campbell. "The process is used in managing time spent on work orders, shift changes, and overlap of shift changes."
According to Campbell, Six Sigma is just not for "widgets" anymore.
"It is a very good tool for learning organizations. Think about fleet management for a moment and what percentage of your time is spent in rework?" Campbell suggests. "If everyone else is in the same situation with budget cuts, what does the rework cost your organization?"
For example, Campbell suggests considering a chronic problem area that never really gets fixed. "Six Sigma will show you how to put a tool kit together and use it as a road map to solve the problem."
Los Alamos Lab Right-Sizes Fleet
At Los Alamos National Labs (LANL) in Los Alamos, N.M., John Tapia, property manager, championed a fleet right-sizing Six Sigma Process Improvement Project (PIP) in FY08.
For FY07, LANL paid $600,000 per month to lease/operate its government vehicles, leaving a gap of $50,000 per month from a monthly goal of $550,000.
"The objective of the PIP was to close 100 percent of this gap, which would result in an annual savings of $600,000," said Tapia.
The Six Sigma Improvement Selection Matrix identified 23 recommended solutions.
"These suggestions were culled down to seven that directly impacted the primary metric of reducing costs," explained Tapia.
Recommended solutions included:
- Managing fleet at the associate director level.
- Developing "standards" for vehicles deployed in various applications.
- Developing "guidance and forms" to request vehicles covered by the GSA Annual Vehicle Replacement process.
- Instituting a "pool" of vehicles to augment the existing fleet, reducing the need to plan for extreme conditions and allowing a gradual reduction of underutilized vehicles.
- Identifying low-cost service providers.
- Renegotiating "utilization" requirements with the National Nuclear Security Administration (NNSA)/Department of Energy (DOE).
Implementation plans were developed for each recommendation, according to Tapia.
As a result of the PIP, at the end of FY09, LANL instituted a replacement vehicle plan requiring division-level manager approval. This new plan resulted in a fleet reduction of 60 vehicles in 2½ years; a cost savings of $245,000 per year based on lease rates, fuel, and maintenance.
"We developed a vehicle standard for basic types of work, which resulted in 30 vehicles replaced by smaller, more economical vehicles," said Tapia. "This equates to a cost savings of about $22,000 per year."
LANL also created vehicle pools for various locations.
"In our office building, all vehicles were pooled, resulting in greater vehicle utilization and availability to the building occupants," said Tapia.
LANL posted preventive maintenance service costs to its fleet Web site, enabling vehicle operators to make informed decisions as to where to take vehicles for service.
For FY09, LANL's government oversight agency agreed to waive its utilization standard requirements due to a major conflict between meeting miles driven and fuel consumption reductions, explained Tapia. "Based on data collected thus far, we are anticipating a significant reduction in fuel consumption in FY09," he noted.
According to Tapia, the Six Sigma process provided a systematic method to collect current data, potential process improvements, and track long-term results. This specific Six Sigma project earned LANL a national DOE Pollution Prevention Award in 2009.